Builder Confidence Rises to 83
Builder confidence rose three points to 83 in November after rising four points to 80 in October, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). The HMI hit an all-time high of 90 last November. Low existing inventories and strong buyer demand sent confidence up despite persistent supply chain issues and chronic shortages of materials, land and labor. All three major HMI indices posted gains in October. The HMI index gauging current sales conditions rose three points to 89, the index tracking traffic of prospective buyers rose three points to 68 and the component measuring sales expectations in the next six months held steady at 84. Regional scores remained mixed. Any number over 50 indicates that more builders view the component as good than view it as poor.
Building Permits Rise 4.0%
Overall building permits rose 4.0% in October to 1.65 million units after falling to 1.59 million units in September. Single-family permits rose 2.7% to 1.07 million units in October after falling to 1.04 million units in September. Multifamily permits rose 6.6% to 581,000 units after falling to 548,000 units in September. Due to supply-chain issues, there are 152,000 single-family units that have been permitted but have not yet begun construction, up 43.4% from a year ago. Regional permits were up on a year-to-date basis.
Housing Starts Fall 0.7%
Housing starts fell 0.7% in October to a seasonally adjusted annual rate of 1.52 million units after falling to 1.56 million units in September. Single-family starts fell 3.9% to 1.04 million units after holding steady at 1.08 million units in September. Single-family starts were up 16.7% year-to-date. The multifamily sector, which includes apartment buildings and condos, rose 7.1% to 481,000 units after falling in the previous two months. Combined single-family and multifamily regional starts were up year to date compared to 2020. Single-family starts are still expected to rise this year, but at a much slower pace than they did during 2020.
New Home Sales Rise 0.4%
New home sales edged up 0.4% in October to a seasonally adjusted annual rate of 745,000 new homes and sales for September were revised sharply downward. Sales were down 23.1% from October 2020. Inventory rose to a 6.3-months’ supply, with 389,000 new single-family homes for sale, up from 379,000 new homes in September. The median price of a new home rose to a record $407,700, up nearly 18% from a year earlier. Regional year-over-year sales were down. Sales of new homes are tabulated when contracts are signed and are considered a more timely barometer of the housing market than purchases of previously-owned homes, which are calculated when a contract closes.
Existing Home Sales Rise 0.8%
Existing home sales rose 0.8% in October to a seasonally adjusted annual rate of 6.34 million units after rising to 6.29 million units in September. Sales were down 5.8% from October 2020, according to the National Association of Realtors. The median price of a home sold in October was $353,900, up 13.1% from October 2020. Year-over-year prices have risen for 116 consecutive months. Total inventories fell 12% to 1.25 million, a 2.4 months’ supply at the current sales pace. Properties were on the market for an average of just 17 days in October. Regional sales were mixed.
Regional Housing Data
Mortgage Rates Steady at 3.1%
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